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Tuesday, January 3, 2012

KLCI Stock - PPB / 4065 - 2011 Quarter 3

Company Info
Market Capital (Capital Size)20,343,177,975 (Very Large)
Par ValueRM 1.00

My Analysis
Forecast P/E now(17.16-0.28)/0.774 = 21.81 (High)
Target Price13.93+0.28 = 14.21 (PE 18.0, EPS 0.774, DPS 0.28)
DecisionNot interested unless stock price below SMA20 a lot (BUY for short term)
Revenue increased 5% and was second consecutive quarter increasing and also higher than preceding year corresponding quarter 23.6%, eps decreased 17% and also lower than preceding year corresponding quarter 20.3%, no cash generated from operating but cash generated from financing and investing is more than enough to cover all expenses, weaker liquidity ratio from strong to high level now, slightly higher gearing ratio at very low level now, all accounting ratio are good, higher inventory can indicate demand of Group products still good
First Support Price16.7
Second Support Price16.0

Research House
HwangDBS Target Price15 (2011-03-04)
AMMB Target Price17.45 (2011-11-23)
WILSON & YORK Target Price19.08 (2011-11-23)

Accounting Ratio
Return on Equity6.48%
Dividend Yield1.63%
Profit Margin35.53%
Tax Rate5.00%
Asset Turnover0.1714
Net Asset Value Per Share11.79
Net Tangible Asset per share11.73
Price/Net Tangible Asset Per Share1.37
Cash Per Share0.92
Liquidity Current Ratio3.9554
Liquidity Quick Ratio2.9498
Liquidity Cash Ratio1.9769
Gearing Debt to Equity Ratio0.0466
Gearing Debt to Asset Ratio0.0432
Working capital per thousand Ringgit sale62.9%
Days to sell the inventory85
Days to collect the receivables66
Days to pay the payables49

Technical Analysis
SMA 2016.639 (Uptrend 10 days)
SMA 5016.602 (Uptrend)
SMA 10016.584 (Uptrend)
SMA 20016.736 (Uptrend)
MACD0.106236 (Uptrend 12 days)
MACD Histogram0.105339 (Uptrend 10 days)

My notes based on 2011 quarter 3 report (number in '000):-
- Higher revenue due mainly to higher flour revenue and an increase in grains trading volume recorded by the grains trading, flour and feed milling division. The environmental engineering, film exhibition and distribution, chemicals trading and manufacturing, livestock farming as well as consumer product divisions also contributed higher revenue

- Lower pbt than FY10Q3 due to larger gain of RM94.3 million in property investment last year and the fair value loss of RM9.6 million in investments in equities this year as compared with a gain of RM18.2 million for the same period last year

- Lower pbt than FY11Q2 mainly due to lower contribution from Wilmar in the third quarter, despite better performance by the grains trading, flour and feed milling division

- Estimate next 4Q eps after 2011 Q3 result announced = 0.1935*4 = 0.774, estimate PE on current price 17.16 = 21.81(DPS 0.18)
- Estimate next 4Q eps after 2011 Q2 result announced = 0.2332*4*0.95 = 0.8862, estimate highest/lowest PE = 19.27/16.79 (DPS 0.28)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.2237*4*0.95 = 0.8501, estimate highest/lowest PE = 20.88/18.88 (DPS 0.25)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.2429*4*1.05 = 1.0202, estimate highest/lowest PE = 18.25/15.57 (DPS 0.18)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.268*4*1.1 = 1.1792, estimate highest/lowest PE = 14.73/12.56 (DPS 0.23)
- Estimate next 4Q eps after 2010 Q1 result announced = 1.2268+0.0127 = 1.2395 (adjustment from 0.242-0.2293, 0.242 represent eps excluded disposal of assets), estimate highest/lowest PE = 13.61/11.54 (DPS 0.73)
- Estimate next 4Q eps after 2009 Q4 result announced = 1.2268 (10% drop from 1.3631), estimate highest/lowest PE = 14.4/12.48 (DPS 0.73)
- Estimate next 4Q eps after 2009 Q3 result announced = 1.2357, estimate highest/lowest PE = 13.15/11.79 (DPS 0.73)
- Estimate next 4Q eps after 2009 Q2 result announced = 1.2152, estimate highest/lowest PE = 13.13/12.22 (DPS 0.23)
- Estimate next 4Q eps after 2009 Q1 result announced = 1.0309, estimate highest/lowest PE = 14.7/9.96 (DPS 0.23)

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